Expert Testimony Required To Show Breach of The Standard of Care Where Attorneys Withdrew As Counsel While Arbitration Was Pending

In legal malpractice actions, in order to establish entitlement to relief plaintiffs are generally required to demonstrate that their attorneys were negligent?that is, that they breached their duty of care. While no expert evidence is required to show that the attorney breached his or her duty of care where the “ordinary experience of the fact finder provides sufficient basis for judging the adequacy of the professional service,” expert testimony may be required where a finder of fact would be tasked with interpretation of complicated rules of professional conduct.

In Joseph DelGreco & Co., Inc. v. DLA Piper LLP, 2013 U.S. App. LEXIS 19572 (2d Cir. Sept. 25, 2013), DLA Piper had represented plaintiff in a supplier/distributor transaction and a subsequent arbitration arising out of that transaction. Plaintiff alleged that DLA Piper had committed negligence by (1) failing to ensure that plaintiff made an initial interest payment, in the amount of $767, as required by the contract; (2) improperly withdrawing as plaintiff’s counsel while the arbitration was pending; and (3) representing plaintiff in the arbitration despite conflicts of interest. The arbitrator ultimately ruled against plaintiff, obligating plaintiff to pay an award of more than $4.5 million.

Plaintiff presented expert testimony that DLA Piper’s failure to ensure that the initial interest payment was timely made was a breach of the duty of care, but did not present any expert testimony with regard to the other allegations. The Second Circuit, affirming the decision of the Southern District of New York, concluded that, notwithstanding the expert testimony that DLA Piper’s failure to ensure that plaintiff made the initial $767 interest payment constituted a breach of the standard of care, no reasonable jury could find that plaintiff’s failure to make the initial interest payment proximately caused the damages that plaintiff incurred at the arbitration. Noting that, under New York law, a plaintiff in a legal malpractice case must show that “but for” the negligence of the defendant?attorney, the plaintiff?client would have prevailed in the underlying action or would not have incurred damages, the Court concluded that, even if plaintiff had made the initial $767 interest payment, the arbitrator’s award was predicated on plaintiff’s “abundant other . . . and more momentous breaches” of the same contract with its supplier.

With regard to plaintiff’s claim that DLA Piper improperly withdrew as counsel while the arbitration was pending, the Court held that plaintiff could not prevail on such claims without providing expert testimony. The Court stated: “A juror’s ordinary experience would not permit her to determine whether a lawyer must incur $605,000 in expenses by continuing to represent a client who, after repeated discussions, has already failed to pay $275,000 in fees. Instead, such a determination requires expert interpretation of complicated rules of professional conduct. See, e.g. N.Y. Rules of Prof’l Conduct R. (c)(5) (permitting withdrawal where ‘the client deliberately disregards an agreement or obligation to the lawyer as to expenses or fees.’)” Likewise, the Court held, plaintiff could not establish that DLA Piper breached the Rules of Professional Conduct with respect to conflicts of interest without providing expert testimony. Accordingly, the Second Circuit affirmed the Southern District’s judgment awarding summary judgment to DLA Piper.

Practice Note: Expert testimony may be required to determine whether a defendant?attorney in a legal malpractice case breached the duty of care, particularly in instances where such a finding would be outside of the ordinary knowledge of a juror.

Reprinted with permission from the October 2013 lpl eadvisory – ABA Standing Committee on Lawyer’s Professional Liability. All rights reserved.